The ability of the US economy to generate new technology industries, such as biotechnology, provides support to the contention that liberal market economies (LMEs) have a comparative institutional ...
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The ability of the US economy to generate new technology industries, such as biotechnology, provides support to the contention that liberal market economies (LMEs) have a comparative institutional advantage in generating radically innovative firms. However, the link between varieties of capitalism and innovation within LMEs has not been systematically explored. This chapter explores the link between institutions and the management of innovative competencies within a successful US biotechnology cluster — San Diego, California. It empirically examines whether national institutional frameworks within the US generate patterns of economic coordination in the areas of finance, employee incentive structures, and labor market organization that benefit firms, and are consistent with predictions of the varieties of capitalism approach. The policy context surrounding the US biotechnology industry is also discussed.Less

How an American technology cluster emerged and became sustainable: San Diego biotechnology

Steven Casper

Published in print: 2007-08-01

The ability of the US economy to generate new technology industries, such as biotechnology, provides support to the contention that liberal market economies (LMEs) have a comparative institutional advantage in generating radically innovative firms. However, the link between varieties of capitalism and innovation within LMEs has not been systematically explored. This chapter explores the link between institutions and the management of innovative competencies within a successful US biotechnology cluster — San Diego, California. It empirically examines whether national institutional frameworks within the US generate patterns of economic coordination in the areas of finance, employee incentive structures, and labor market organization that benefit firms, and are consistent with predictions of the varieties of capitalism approach. The policy context surrounding the US biotechnology industry is also discussed.

Cluster policies have become very popular among policy makers over the last thirty years. However, the mechanisms at work behind cluster dynamics, the gains that can be expected from more clustering, ...
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Cluster policies have become very popular among policy makers over the last thirty years. However, the mechanisms at work behind cluster dynamics, the gains that can be expected from more clustering, and the determinants of cluster policies that are implemented are not so clear. This book addresses these issues theoretically and empirically on the French case. Studying France is interesting because there is a long tradition of strong government intervention regarding the location of economic activity and because French cluster initiatives are more or less unified across the country. From a theoretical point of view, spatial agglomeration brings gains until a certain point from which congestion effects can offset these gains, and under certain conditions, it is likely that firms tend to cluster too much. This raises questions about cluster policies that would aim at always increasing concentration. Moreover, cluster policies are very demanding in terms of information and are subject to many political economy issues. The empirical analysis on French firm‐level data confirms that, in the short run, firms reap gains from agglomeration until a given level of agglomeration from which congestion effects become more important. Given these agglomeration economies, the current geography in France does not seem vastly suboptimal. On the other hand, the analysis of the first cluster policy implemented in this country shows that traditional equity determinants of regional policies, instead of competitiveness considerations, were still in play. In that sense, while acknowledging the positive impact of spatial agglomeration on firm‐level performance, this book tends to tone down the worldwide enthusiasm for cluster policies.Less

The Economics of Clusters : Lessons from the French Experience

Gilles DurantonPhilippe MartinThierry MayerFlorian Mayneris

Published in print: 2010-11-01

Cluster policies have become very popular among policy makers over the last thirty years. However, the mechanisms at work behind cluster dynamics, the gains that can be expected from more clustering, and the determinants of cluster policies that are implemented are not so clear. This book addresses these issues theoretically and empirically on the French case. Studying France is interesting because there is a long tradition of strong government intervention regarding the location of economic activity and because French cluster initiatives are more or less unified across the country. From a theoretical point of view, spatial agglomeration brings gains until a certain point from which congestion effects can offset these gains, and under certain conditions, it is likely that firms tend to cluster too much. This raises questions about cluster policies that would aim at always increasing concentration. Moreover, cluster policies are very demanding in terms of information and are subject to many political economy issues. The empirical analysis on French firm‐level data confirms that, in the short run, firms reap gains from agglomeration until a given level of agglomeration from which congestion effects become more important. Given these agglomeration economies, the current geography in France does not seem vastly suboptimal. On the other hand, the analysis of the first cluster policy implemented in this country shows that traditional equity determinants of regional policies, instead of competitiveness considerations, were still in play. In that sense, while acknowledging the positive impact of spatial agglomeration on firm‐level performance, this book tends to tone down the worldwide enthusiasm for cluster policies.

Germany has long been categorized as an organized or coordinated market economy. Moreover, a key prediction of comparative institutional theory is that Germany should perform poorly in radically ...
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Germany has long been categorized as an organized or coordinated market economy. Moreover, a key prediction of comparative institutional theory is that Germany should perform poorly in radically innovative industries such as biotechnology. In the mid 1990s, the German government launched a series of wide-ranging public policies with the aim of developing a world-class biotechnology industry. This chapter examines these policies and evaluates their success in creating a sustainable biotechnology industry in Germany. German policies have created a large industry, in terms of the number of companies launched, in a short period of time. However, empirical evidence suggests that this industry has not become sustainable, in terms of generating adequate venture capital finance for companies or generating an active labor market for scientists and managers working within the industry. These problems are linked to long-standing institutional arrangements in the areas of finance, corporate governance, and labor market regulation, suggesting that the ability of governments to circumvent national institutional frameworks may be limited.Less

The German biotechnology industry: the limits of orchestrated innovation

Steven Casper

Published in print: 2007-08-01

Germany has long been categorized as an organized or coordinated market economy. Moreover, a key prediction of comparative institutional theory is that Germany should perform poorly in radically innovative industries such as biotechnology. In the mid 1990s, the German government launched a series of wide-ranging public policies with the aim of developing a world-class biotechnology industry. This chapter examines these policies and evaluates their success in creating a sustainable biotechnology industry in Germany. German policies have created a large industry, in terms of the number of companies launched, in a short period of time. However, empirical evidence suggests that this industry has not become sustainable, in terms of generating adequate venture capital finance for companies or generating an active labor market for scientists and managers working within the industry. These problems are linked to long-standing institutional arrangements in the areas of finance, corporate governance, and labor market regulation, suggesting that the ability of governments to circumvent national institutional frameworks may be limited.

Cluster policies have become very popular among policy makers over the last thirty years. Following the success of Silicon Valley and following the influential work by Michael Porter, clusters have ...
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Cluster policies have become very popular among policy makers over the last thirty years. Following the success of Silicon Valley and following the influential work by Michael Porter, clusters have come to be seen by many as the magical formula for regional development, innovation, and growth. They also appeared as a way to renew industrial policies fallen into disrepute. Most of the extant works on clusters are qualitative. These approaches are very useful but fail to put some numbers on the effects at play. This is what this book tries to do in the French case. France is interesting for this topic since there is a long tradition of strong government intervention regarding the location of economic activity and because French cluster initiatives are more or less unified across the country.Less

Introduction

Gilles DurantonPhilippe MartinThierry MayerFlorian Mayneris

Published in print: 2010-11-01

Cluster policies have become very popular among policy makers over the last thirty years. Following the success of Silicon Valley and following the influential work by Michael Porter, clusters have come to be seen by many as the magical formula for regional development, innovation, and growth. They also appeared as a way to renew industrial policies fallen into disrepute. Most of the extant works on clusters are qualitative. These approaches are very useful but fail to put some numbers on the effects at play. This is what this book tries to do in the French case. France is interesting for this topic since there is a long tradition of strong government intervention regarding the location of economic activity and because French cluster initiatives are more or less unified across the country.

Regional economic development is shaped by many policies, which are implemented by national governments, regional and state governments, and local governments. But local economic development policies ...
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Regional economic development is shaped by many policies, which are implemented by national governments, regional and state governments, and local governments. But local economic development policies in Greater Los Angeles and the San Francisco Bay Area since 1970 had little to do with the economic divergence of these two regions. In reality, many so-called economic development policies have little to do with economic development as such, instead emphasizing land use changes and competition for sales tax revenue rather than industry and job development. Many of the problems with local planning and development policies in the United States in general are exemplified by the comparison of the San Francisco Bay Area and Greater Los Angeles.Less

Economic Development Policies : Their Role in Economic Divergence

Michael StorperThomas KemenyNaji Philip MakaremTaner Osman

Published in print: 2015-09-02

Regional economic development is shaped by many policies, which are implemented by national governments, regional and state governments, and local governments. But local economic development policies in Greater Los Angeles and the San Francisco Bay Area since 1970 had little to do with the economic divergence of these two regions. In reality, many so-called economic development policies have little to do with economic development as such, instead emphasizing land use changes and competition for sales tax revenue rather than industry and job development. Many of the problems with local planning and development policies in the United States in general are exemplified by the comparison of the San Francisco Bay Area and Greater Los Angeles.

This chapter analyses empirically a public policy promoting industrial clusters in France. Cluster policies have become popular in many countries but have not been extensively evaluated empirically. ...
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This chapter analyses empirically a public policy promoting industrial clusters in France. Cluster policies have become popular in many countries but have not been extensively evaluated empirically. The chapter uses data on production and employment for firms that benefited from the policy and for firms that did not, both before and after the policy started. It first shows that the policy selected firms in relative decline. Furthermore, the results suggest that the policy had no major effect either on their productivity or in terms of employment.Less

Public Support for Clusters: A Case Study on French ‘Local Productive Systems’

Gilles DurantonPhilippe MartinThierry MayerFlorian Mayneris

Published in print: 2010-11-01

This chapter analyses empirically a public policy promoting industrial clusters in France. Cluster policies have become popular in many countries but have not been extensively evaluated empirically. The chapter uses data on production and employment for firms that benefited from the policy and for firms that did not, both before and after the policy started. It first shows that the policy selected firms in relative decline. Furthermore, the results suggest that the policy had no major effect either on their productivity or in terms of employment.

This chapter reviews the key arguments and findings of the book and draws conclusions regarding the implications for a relational economic support policy—a policy which focuses on economic agency and ...
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This chapter reviews the key arguments and findings of the book and draws conclusions regarding the implications for a relational economic support policy—a policy which focuses on economic agency and conceptualizes extra-regional linkages that connect territories with global resource and knowledge pools. In order to clarify this, it develops the foundations of a relational cluster policy. In addition, the chapter discusses the aspects of relational multidimensional cluster policies, such as vertical cluster dimension, horizontal cluster dimension, power relations, institutional cluster dimension, and external cluster dimension.Less

Consequences for Relational Policies

Harald BatheltJohannes Glückler

Published in print: 2011-06-23

This chapter reviews the key arguments and findings of the book and draws conclusions regarding the implications for a relational economic support policy—a policy which focuses on economic agency and conceptualizes extra-regional linkages that connect territories with global resource and knowledge pools. In order to clarify this, it develops the foundations of a relational cluster policy. In addition, the chapter discusses the aspects of relational multidimensional cluster policies, such as vertical cluster dimension, horizontal cluster dimension, power relations, institutional cluster dimension, and external cluster dimension.

This chapter discusses the chaotic cluster concept, the mixed cluster phenomenon, and popular cluster policy in China. It argues that insertion into global value chains will bring opportunities for ...
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This chapter discusses the chaotic cluster concept, the mixed cluster phenomenon, and popular cluster policy in China. It argues that insertion into global value chains will bring opportunities for small local firms in Chinese clusters for learning and upgrading but multinational power may also dilute local ambition to creatively upgrade the production system by any means possible. An on-going problem for China’s industrial clusters — and one that needs to be urgently addressed — will be the transition from production capacity to capacity for innovation.Less

Making clusters innovative? : A Chinese observation

Jici Wang

Published in print: 2014-10-30

This chapter discusses the chaotic cluster concept, the mixed cluster phenomenon, and popular cluster policy in China. It argues that insertion into global value chains will bring opportunities for small local firms in Chinese clusters for learning and upgrading but multinational power may also dilute local ambition to creatively upgrade the production system by any means possible. An on-going problem for China’s industrial clusters — and one that needs to be urgently addressed — will be the transition from production capacity to capacity for innovation.